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BILLS;Fair Work Amendment Bill 2014;Second Reading – 16 Mar 2015

Another day, another broken promise from the Abbott government. The Prime Minister, Mr Abbott, promised Australians before the election that Work Choices was dead, buried and cremated, although not necessarily in that order. He promised the Australian people that amendments to the Fair Work Act would not go any further than the government’s pre-election promises. And he promised that the government would implement specific recommendations from the 2012 Fair Work Act Review. This bill, the Fair Work Amendment Bill 2014, breaks all three of those promises. The problem with the government, with the Liberal Party and their coalition colleagues, is that they just cannot help themselves. The race to the bottom on workplace relations is in their blood. It is part of their DNA. It is who they are and who they will always be: strident opponents of workers rights.

The government, before the election, promised to return to the sensible centre on workplace relations, but this bill is a lurch to the right. The sensible centre was already established with the Fair Work Act. If those opposite wish to claim, in opposing this bill, that Labor is beholden to the union movement, they would do well to remember that neither unions nor business were entirely happy with the concessions that were made in drafting the Fair Work Act. Rather, what the government are showing by bringing forward this bill is that they are beholden to the ideologues who favour the deregulation of workplace relations in Australia. They are beholden to their mates in big business, supported by their cheer squads in the Murdoch media and the Institute of Public Affairs.

There are a number of areas in this bill in which the government are going beyond their pre-election promises, but the three I wish to focus on in my contribution tonight are individual flexibility agreements, greenfield agreements and right of entry. Let us begin with individual flexibility arrangements. Labor first introduced the IFA framework in 2009, and we introduced IFAs because we agree that flexible work practices can deliver benefits to both employees and employers. However, we did not intend IFAs to be a tool for employers to impose on unsuspecting employees as a means of ripping away conditions such as penalty rates. That is why we put in place safeguards to ensure that low-paid and vulnerable workers were protected. IFAs swap a fairly insignificant monetary benefit for a non-financial benefit. These arrangements are now in place across the majority of enterprise agreements in Australia, and the system is fair and equitable for both parties.

The government wants to establish the model flexibility term as a minimum for all enterprise agreements, but data cited by the Fair Work expert panel already demonstrates that the majority of enterprise agreements provide as much flexibility as, if not more flexibility than, is provided by the model flexibility term. The Fair Work Act Review expert panel recommended that IFAs allow for a non-monetary benefit to be conferred in exchange for a monetary benefit. In doing so, they said the value of the monetary benefit forgone must be ‘relatively insignificant’, and the value of the non-monetary benefit must be ‘proportionate’. However, neither of these terms are included in this bill.

Labor believes it is extremely unfair to allow workers to be coerced into trading away significant amounts of take-home pay in exchange for non-monetary benefits. This provision would make low-paid workers particularly vulnerable, particularly when the arrangements are proposed by employers and the employee may not fully understand the value of what they are trading away and what they are receiving. I would like to ask those opposite: are we going to see agreements like those we saw under Work Choices with Spotlight, where workers ended up trading away their penalty rates, incentive based payments, overtime rates, annual leave loading and holiday pay for a pay increase of a paltry 2c per hour? I worry that this amendment opens the door to employers to strip away entitlements such as penalty rates from low-skilled, low-paid, vulnerable workers in exchange for token non-monetary benefits. Unless the government is going to implement the expert panel’s recommendation in full, there is no way that Labor can accept this amendment.

It is interesting to note that the government, in picking and choosing the expert panel recommendations they have adopted, have omitted an important safeguard for employees. There is nothing proposed in this bill to implement the recommendation that the Fair Work Ombudsman be notified of the details of any IFA made, and the panel itself said that this would enable the Fair Work Ombudsman to investigate whether these arrangements were being abused by an employer or a group of employers.

The government has also included a requirement for employees to provide their employers with a ‘genuine needs’ statement, which is intended to capture an employee’s state of mind at the time the IFA was agreed to. The government is passing this off as an employee safeguard, whereas it actually provides employers with a deferred defence to any future claim that they contravened a flexibility term in agreeing to an IFA. While a defence to an alleged contravention of a flexibility term was recommended by the expert panel, we on this side of the chamber would contend that the amendment is not in the spirit of the recommendation, as it is heavily weighted towards employers.

The government’s proposed amendments to greenfield agreements give employers an absolute advantage when it comes to negotiating an enterprise agreement. Employers will gain absolute control over which unions they choose to negotiate with. After an employer agrees to bargain with an employee organisation, the employer at any time could issue a notice to commence a three-month notified negotiation period. During this period, an employer can basically walk away from the negotiation table and simply wait for those three months to expire, after which time the employer, and only the employer, can take the proposed agreement to the Fair Work Commission for assessment and approval. In no-one’s language is this a genuine negotiation between employers and employees. This is a framework for allowing employers to negotiate with themselves.

Finally, I come to the right-of-entry provisions. Labor sought to establish right-of-entry provisions which are not weighted too heavily in favour of unions or employers, but in this bill the provisions are weighted heavily in favour of employers. The government has included a provision which requires the Fair Work Commission, when resolving disputes about the frequency of visits, to consider the combined impact on the employers’ operations. This is clearly intended to exclude all unions from a site when only one union has been found to have entered too frequently. It punishes all unions for the actions of one.

The government claim that they are adopting a recommendation of the expert panel to provide Fair Work Australia with greater power to resolve disputes about the frequency of visits, but they are actually going well beyond that. Labor also has concerns about the invitation certificate process the government are proposing. The government suggest that, if an employee would like their union to come to their workplace and they wish to remain anonymous, the union must apply to the Fair Work Commission to obtain an invitation certificate. In a small business especially, this risks exposing employees who have requested a union visit to a small business. Even though the request can be made anonymously, it would not be too hard, in a business with just a handful of employees, to find out who made the request.

Also on the issue of right of entry, I will make some comment on the government’s proposal to remove provisions which help facilitate union visits to work sites. The government are claiming that employers have to pay for the cost of ‘union boss joyrides to remote work sites’. What they will not tell you is that employers are only required to facilitate access when their premises are not readily accessible by transport other than that provided by the employer, or the nature of the premises means that the union official has to stay overnight yet the only accommodation that is reasonably available is that provided by the employer. Employers are not required to pay such expenses unless they choose to. Removing this provision will make it physically impossible for union representatives to visit certain workplaces. It will create two classes of workers: those who can be visited at work by a union representative, and those who cannot. As someone who used to be involved in training programs for a union on workplace health and safety, I can attest to how important I consider workplace health and safety but also to how vital right of entry provisions are to overseeing health and safety in workplaces where it is not being properly adhered to.

As I said before, these changes represent a broken promise on workplace relations. They were not announced by the government before the election, and they are not, as the government would have you believe, implementing the recommendations of the Fair Work Review. So why are the government breaking their election promises on workplace relations? Why are they seeking once again to undermine the rights and conditions of workers in a race to the bottom on labour standards? Why do they insist on continuing this ideological crusade, which the Australian people so comprehensively rejected in 2007?

When I spoke earlier this year on the government’s draconian job seeker compliance legislation, I explained that they were looking for a scapegoat for their failure to create jobs. When they introduced that bill, their scapegoat was job seekers, but they have found a number of other targets, including our workplace relations system. The government made the very modest promise to create one million jobs over five years, a promise which I think they have gone very quiet on lately. But, after a year and a half of the Abbott government, we have 80,000 more Australians in the unemployment queues than when Labor left office.

By contrast, Labor created almost a million jobs during our six years in government following the largest economic downturn since the Great Depression. We left office with unemployment at 5.8 percent. It is now up to 6.3 per cent. The last time it was at that level was when Mr Abbott was the minister for employment. Labor grew Australia’s economy from the fifteenth to the twelfth largest in the world, and it was Labor that achieved a AAA credit rating from all three ratings agencies, something that was never, never achieved under the Howard government. Despite the rhetoric from the doomsayers opposite, Labor had a strong economic record even with the challenges of the global financial crisis.

But, under the Abbott government, business confidence and consumer confidence are down, and the government’s budget strategy is falling to pieces. I would suggest to any of the Tasmanian senators from the other side that, if they want to see very quickly some examples of the loss of business, they should come to Kingston, south of Hobart, where half the shops have now closed in the past 12 to 18 months and people have just walked away from businesses. Australia’s per capita gross domestic product has fallen from the eighth largest in the world to the fourteenth.

So it is no wonder that the government are looking around to find scapegoats—anyone they can blame for their own failure to create jobs and economic growth in Australia. They blame the unions and call an expensive and wasteful royal commission, trying to make out against all evidence that corruption is widespread within the union movement. They blame government spending, yet the Abbott government doubled the deficit after coming to office. They blame a price on carbon, even though an open letter signed by Australia’s leading economists says that a price and limit on carbon pollution is the most economically efficient way to reduce emissions. I am still somewhat surprised carbon pricing was rejected by the Liberals when market based solutions are part of their core ideology. They blame job seekers, portraying them as bludgers who are cheating the system and not trying hard enough to find a job. They ignore the fact that job seekers need proper assistance and training to find employment, not just more penalties. And they blame people on the disability support pension, but once again their approach is all stick and no carrot. With the release of the Intergenerational report, the most heavily politicised IGR in history, they seek to blame older Australians, claiming our pension and health care systems are unsustainable while all the evidence is to the contrary. With this bill, they are blaming Australia’s workplace relations system, ignoring the fact that labour productivity actually went up, not down, with the introduction of the Fair Work Act.

If the government want to know the real reason why business confidence has stalled—if they want to know the reason why they have been such a failure on job creation—they do not need to look to unions. They do not need to look to the unemployed, people with disability or seniors. They do not need to look to Australia’s response to climate change. They need to look in a mirror.

After all, this is the government which Morgan Stanley said was damaging confidence in the Australian economy through its ‘alarmist budget narrative’. I will just repeat that: through its ‘alarmist budget narrative’. This is the government which has made every effort to avoid having infrastructure programs independently assessed by Infrastructure Australia to find out what economic benefit they would actually deliver to Australia. In fact, it has failed to implement its pre-election promise to conduct an independent cost-benefit analysis for projects valued at over $100 million. And the same government has been running around the country, announcing billions of dollars of Labor infrastructure projects and trying to claim them as its own. This is the government which tried to play chicken with Australia’s auto industry and lost, resulting in the loss of tens of thousands of jobs in automobile and parts manufacturing.

This is also the government which is going to give Australia a second-rate national broadband network consisting of outdated HFC technology and a 100-year-old copper network. This will cripple our economic opportunity in ICT and the businesses which rely on it, while other countries move ahead in leaps and bounds with their optic fibre rollouts. Australia has already dropped to the 44th lowest in the world in average peak broadband connection speeds. It is a shame.

And yet this is the government which is ripping money out of higher education and wants to make students pay thousands more for university degrees. This is the government which rejects science, and was until recently the first government since 1931 not to have a science minister. They have defunded the Climate Change Authority and gutted the CSIRO, sacking one in every five of its scientists. The CSIRO is the organisation which recently netted the government $430 million in royalties from the invention of wi-fi, a technology that is now used worldwide in the daily lives of millions. And this is the government which failed to allow Australian companies the opportunity to tender for our submarine fleet and build our submarines in Australia by Australian workers.

The fact is this government does not understand that the key to economic success is economic productivity. They failed miserably to understand that the key drivers of productivity are education and training, innovation and infrastructure. Despite what this government would have us believe, there is not a significant problem with our workplace relations system. You just need to look at Australia’s labour productivity as evidence for that. When was the highest growth in labour productivity in the past ten years? It certainly was not under Work Choices. No, it was in 2012, under the Fair Work Act, and under the Fair Work Act industrial disputes are down. There was a quarterly average of 13.5 days lost to industrial disputation under the Howard government. Under the previous Labor government—guess what—it was only 4.6 days.

And the government’s claim that Australia faces a wages explosion is completely bogus. The latest increase in the wage price index was 2.6 per cent, below inflation. In fact, the real wages breakout was that in the pay of top executives. Until Labor’s reforms to statutory executive pay, the salary of top CEOs was out of control, growing 130 per cent between 2001 and 2010. By contrast, inflation had grown 28.6 percent and average weekly earnings by 52 percent.

While Mr Abbott has such a tenuous grip on his leadership, even when he is scraping off the barnacles of his unfair GP tax and unaffordable paid parental leave scheme the urge to reintroduce elements of Work Choices is irresistible to him. This Liberal government under any leader will always be compelled by their Pavlovian instinct to cut the wages and entitlements of Australian workers. They simply cannot help themselves. But the truth is that Work Choices is far from being ‘dead, buried and cremated’ as the Prime Minister claimed before the last election. It is merely resting.